Sinclair estimates $4.2M in new cost under Obamacare

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Sinclair estimates $4.2M in new cost under Obamacare

What would it take Sinclair Community College to fund $4.2M to pay for the Affordable Care Act mandate regarding benefit eligible employees?

4.8 percent — Reduce salary for all full-time and part-time employees

9 percent — Increase tuition and fees

28 leave days — Eliminate three personal days, 15 sick days and 10 vacation days

33 days — Furlough all non-faculty employees

34 percent — Reduce non-personnel discretionary budgets, such as travel, supplies, special events college-wide

48 percent — Raise employee share of health care premium (current is 20 percent)

54.5 percent — Reduce student and other hour part-time employee wages

60 positions — Lay off full-time employees

Source: Sinclair Community College

Sinclair Community College estimates it will cost up to $4.2 million to provide health care benefits to part-time employees who could qualify for coverage under a looming mandate in the Patient Protection and Affordable Health Care Act.

As many as 423 part-time workers at Sinclair could qualify for employer-sponsored insurance as of Jan. 1, 2014, when large employers will be required to provide health care to all those who work 30 hours or more a week. Sinclair is one of the first colleges in Ohio to estimate the impact that extending health coverage to part-timers will have on its budget.

The college said to cover the $4.2 million expense, it would have to charge students a 9 percent tuition increase, or furlough all non-faculty employees for 33 days, or reduce everyone’s salary 4.8 percent, or lay off 60 full-time employees — although it is not considering those as options at this time. The estimates come amid confusion for all colleges and universities nationwide about how adjunct professors, who work part-time, should be treated under the Affordable Care Act, commonly known as Obamacare.

“Until some clarification or ruling on this is provided, it’s hard to know what the impact will be,” said Sinclair spokesman Adam Murka, who said the cost could be as low as $2 million. “It’s very much in flux.”

Some colleges nationwide have responded by limiting the hours adjunct faculty can work, and Ohio’s Youngstown State University and Stark State College have already done so to avoid paying large penalties when the mandate takes effect. The penalty for not complying is as much as $2,000 per full-time employee.

Sinclair is currently reviewing whether to provide insurance to those who would be eligible or limit their hours to make them ineligible. The college has 191 adjuncts who could qualify for health care, as well as 160 hourly staff, 14 supplemental faculty retirees and 58 who are both adjunct and part-time hourly workers.

“It’s unclear exactly how we’ll solve that, but it’s important for us to address,” board of trustees chairman Barney Wright said at a recent board meeting.

Sinclair estimates it would cost $10,000 per employee to provide health insurance. The college estimates it will spend $8 million this year to provide health care. Its total operating budget is $125 million.

Clark State Community College, Ohio State University and the University of Cincinnati are still evaluating the issue, according to the schools. Others will not be impacted, such as the University of Dayton, which has a more generous policy for providing health care than required by the Affordable Care Act. Eleven schools are working with special council obtained through the Ohio Attorney General’s Office.

“This is an issue that many of our colleges are still wrestling with,” said Jeff Ortega, spokesman for the Ohio Association of Community Colleges. U.S. Sen. Sherrod Brown, D-Ohio, is working with colleges to facilitate communication with the Department of Health and Human Services so employers can better understand their responsibilities, according to his office.

Some guidance has come down from federal regulators, who recently said employers must use a “reasonable method” to determine whether adjuncts will qualify for health care, adding it would “not be reasonable” to only consider their time in the classroom and “not other hours that are necessary… such as class preparation time,” according to the American Federation of Teachers.

The rule could apply to more than half of the faculty in the United States, who are part-time, according to the New Faculty Majority, a national coalition formed in 2009 to improve working conditions of adjuncts. Only about 23 percent of adjunct professors currently have access to health care benefits through their academic employer, according to a study by the Coalition on the Academic Workforce.

“It’s a very pressing issue for adjuncts who don’t have access to health insurance,” said New Faculty Majority president Maria Maisto, who added this is especially important in Ohio, where part-time faculty cannot compel their institutions to allow them to collectively bargain. Limiting their hours not only reduces their personal income, it stands to threaten their ability to effectively work with students.

“Our worry is that it’s going to have a horrible effect on students,” said Maisto, an adjunct English professor at Cuyahoga Community College in Cleveland. “People really need to understand the implications for the quality of education. If we’re cutting people’s hours … that’s going to wreak havoc on students. They’ll never be able to find their instructors because they’ll be running around trying to make a living.”

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